Assessment of the US Revenue Cycle Management Market, Forecast to 2022

Assessment of the US Revenue Cycle Management Market, Forecast to 2022

How Value-Based Care is Transforming the Ecosystem

RELEASE DATE
31-Oct-2017
REGION
North America
Research Code: K1C3-01-00-00-00
SKU: HC02914-NA-MR_21034

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Description

Revenue cycle management (RCM) refers to myriad administrative and clinical functions around the capture, management, and collection of patient service revenue. The RCM process starts with admission (patient access) and continues through to accounts receivable (payment and collections). A variety of RCM solutions (e.g., IT applications and services) are deployed to help healthcare providers perform different functions.

The objective of this research service is to present a comprehensive analysis of the US RCM market with respect to trends, revenue growth potential, and the dynamics at play for RCM information technology (IT) and services deployed by hospitals and physician practices through 2022.

Additionally, the report will
•     analyze market forces impacting adoption of RCM IT and service solutions among hospitals and physician practices
•     evaluate existing and emerging regulatory objectives centered on providers’ financial risk management initiatives
•     highlight best practices in the areas of design and deployment of an integrated financial workflow that supports value-based care
•     assess the outlook of outsourced or shared service-based RCM operating models
•     identify 5 major growth opportunity areas related to RCM
•     estimate the revenue potential of the total US RCM market (software applications and services), and include breakdowns by hospitals and physician practices, from 2016 to 2022
•     shortlist vendors that propose best-in-class solutions for hospitals and tphysician practices

This study is segmented into major functional segments of RCM,
•     Patient access
•     Registration and charge capture
•     Billing and collection

In terms of end-user adoption, this study classifies the buyer market in two broad provider categories:
•     Hospitals
•     Physician practices

The market projection ($ value) is stratified based on the following overarching RCM product segments:
•     IT (software applications)
•     Services

Market Background
The shift in population demographics coupled with the rise of risk or value-based reimbursement models is driving the need for better prediction and management of revenue cycles, especially for high and at-risk patient populations. The prevalence of legacy RCM IT systems, which do not optimally support the goal of building a broader but coordinated and enterprise-wide financial ecosystem, is restricting providers from achieving the desired results around healthcare cost and collection. Most US-based providers still grapple with low operating margins, resulting from poor accounts receivable (A/R) performance and high average denial volumes. Many health systems attribute this inefficiency to their suboptimal knowledge and implementation of value-based RCM pathways that require significant investments in RCM IT. The need for efficient claims processing, which in turn results in optimized collection of risk-based revenue, supports adoption of value-based financial management solutions. Most providers that embrace alternative payment models acknowledge the need to deploy progressive scheduling, billing, and analytics technology modules capable of digitizing the entire RCM ecosystem. This view results from the growing adoption of payer contracts with specific provisions for efficient claims management, in addition to the need for integrating new capabilities that will meet the increasing financial responsibility of patients with coinsurance and large deductibles. Overall, the top unmet market needs driving adoption of next-generation RCM solutions among health systems in US are:
•     Comprehensive regulatory compliance and financial risk mitigation
•     The ability to collaborate with payers to customize revenue cycle workflows
•     Elimination of preventable operational expenses, attributed to claims processing
•     Automated identification of hidden patterns and root causes of claim denial
•     Optimized collection of payments, rebates, and incentives for patient services
•     Real-time reporting of financial and operational performance at an enterprise level

As a result, new growth opportunities involving external RCM solutions have gained precedence among many hospitals and physician practices. Most of them are willing to invest in advanced RCM capabilities that can streamline financial performance cost effectively by paving the way for seamless payer-provider communications pertaining to financial risk management.

These end users are likely to prioritize procurement of RCM solutions from external IT vendors based on implementation evidence and cost/benefit benchmarks. Hence, going forward, they are expected to rely on RCM vendors with proven expertise in optimizing financial performance through comprehensive patient access, error-free claims preparation, automated billing workflows, and robust RCM analytics. Vendors with solutions that can complement providers’ incumbent value-based payment arrangements and RCM IT ecosystems are expected to thrive in this market.

RESEARCH: INFOGRAPHIC

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Table of Contents

Key Findings—Study Highlights

Scope and Segmentation

Market Engineering Measurements

CEO’s Perspective

Key Companies to Watch

Executive Summary—3 Big Predictions

Market Definition

Market Background

Introduction to MACRA—Significant Changes to Provider Reimbursement Processes

Comparison of the 3 Payment Pathways Under MACRA

MACRA’s Final Rule—Implementation Timeline and Payment Adjustment Metrics

MACRA Final Rule for Reporting Year 2018—5 Key Takeaways

US RCM Ecosystem—Key Product Applications

End-User and Product Segmentation of RCM

Key Market Elements Driving the US RCM Industry

End User-Specific Market Drivers

Physician Workflow

Why is it Important to Understand Trends in RCM?

Staffing Challenges Related to Medical Billing and Coding

Key Business Challenges

Drivers of Replacing RCM Platforms or Adding Value-added Capabilities

State of Digitization and Its Impact on Providers’ RCM Expense

Adoption of Essential RCM Components

Adoption of Next-Gen RCM Components

Replacement Rate vsPure Upgrade

Key Pain Points

Benefits of Physician Practice Management Solution

Considerations to Ensure Optimal Results from Practice Management Systems

Evolution of Practice Management Systems

Replacement Rate vsFirst-Time Purchase Including Add-ons

KPIs for Hospitals

Value-Based RCM—How the Ecosystem Should be Conceptualized

Introduction to Outsourced RCM Services—Assessment of Market Forces

Outlook for Outsourced RCM Services—A Wide Array of Business Models are at Play

Key Considerations for RCM Outsourcing

Assessment of Best Practices—Outsourced RCM Services

Market Engineering Measurements

Forecast Methodology and Assumptions

Revenue Forecast

Percent Revenue Forecast by End-User Segment

Revenue Forecast by End-User Segment

Market Engineering Measurements

Revenue Forecast

Revenue Forecast by Offering

Market Engineering Measurements

Revenue Forecast

Revenue Forecast by Offering

Penetration Analysis—Hospitals

Penetration Analysis—Physician Practices

Competitive Market Forces

Vendor Market Share—Total RCM Market

Vendor Trends

How Vendors Mitigate Financial Risk via Value-based RCM Solutions

Market Gaps in the United States

Competitive Environment

Healthcare RCM M&A—How 2016 Fared Against 2015

Notable M&As

Vendor Segmentation—Software Application Providers

Vendor Segmentation—Service Providers

5 Major Growth Opportunities

Strategic Imperatives for Success and Growth

The Last Word—3 Big Predictions

The Last Word—Discussion

Legal Disclaimer

Market Engineering Methodology

Exhibits

Sources

Vendor Segmentation Capability Definitions

List of Figures
  • 1. Total RCM Market: Growth Rate, US, 2016–2022
  • 2. Total RCM Market: MACRA’s Impact on Provider Reimbursement, US, 2015–2016
  • 3. Total RCM Market: MACRA’s Impact on Provider Reimbursement, US, 2015–2016
  • 4. MACRA Final Rule, US, 2017–2019
  • 5. Total RCM Market: Core and Advanced Applications Driving the Ecosystem, US, 2017
  • 6. Total RCM Market: Denials’ Impact on Providers Total Missed Revenue Opportunities, US, 2013–2015
  • 7. Total RCM Market: Staffing Challenges Related to Medical Billing and Coding, US, 2017
  • 8. Total RCM Market: State of Digitization and Its Impact on Providers’ RCM Expense, US, 2014–2015
  • 9. Hospital RCM Market: Adoption of Essential RCM Components, US, 2015–2017
  • 10. Hospital RCM Market: Adoption of Next-Gen RCM Components, US, 2015–2017
  • 11. Physician Practice RCM Market: Key Pain Points, US, 2017
  • 12. Physician Practice RCM Market: Providers' Perceived Value of Benefits, US, 2016
  • 13. Total RCM Market: KPIs for Hospitals, US, 2016–2017
  • 14. Total RCM Market: Corporate Objectives for VBC, US, 2017–2022
  • 15. Total RCM Market: What Leading Providers Do to Enable VBC, US, 2017–2022
  • 16. Total RCM Market: Strategic and Tactical Consideration for RCM Outsourcing, US, 2017
  • 17. Total RCM Market: Market Engineering Measurements, US, 2016
  • 18. Total RCM Market: Revenue Forecast by End-User Segment, US, 2016–2022
  • 19. Hospital RCM Market: Market Engineering Measurements, US, 2016
  • 20. Hospital RCM Market: Revenue Forecast by Offering, US, 2016–2022
  • 21. Physician Practice RCM Market: Market Engineering Measurements, US, 2016
  • 22. Physician Practice RCM Market: Revenue Forecast by Offering, US, 2016–2022
  • 23. Total RCM Market: Vendor Market Share, US, 2016
  • 24. Total RCM Market: Critical RCM Capabilities Being Embraced by Providers for Financial Risk Management, US, 2016–2022
  • 25. Total RCM Market: Competitive Structure, US, 2017
  • 26. Hospital RCM Market: Competitive Structure, US, 2017
  • 27. Physician Practice RCM Market: Competitive Structure, US, 2017
  • 28. Total RCM Market: Notable M&As, US, 2015–2016
  • 29. Total RCM Market: Software Application Providers, US, 2017
  • 30. Total RCM Market: Service Providers, US, 2017
List of Charts
  • 1. Total RCM Market: Market Engineering Measurements, US, 2016
  • 2. Total RCM Market: End-User and Product Segmentation, US, 2016
  • 3. Hospital RCM Market: Revenue Segmentation Across Product Categories, US, 2017
  • 4. Physician Practice RCM Market: Revenue Segmentation Across Product Categories, US, 2017
  • 5. Total RCM Market: Physician Workflow on a Typical Day, US, 2017
  • 6. Hospital RCM Market: Rate of Replacement vs. Upgrades, US, 2013–2020
  • 7. Total RCM Market: Revenue Forecast, US, 2016–2022
  • 8. Total RCM Market: Revenue Share Forecast by End-User Segment, US, 2016–2022
  • 9. Hospital RCM Market: Revenue Forecast, US, 2016–2022
  • 10. Hospital RCM Market: Revenue Forecast by Offering, US, 2016–2022
  • 11. Physician Practice RCM Market: Revenue Forecast, US, 2016–2022
  • 12. Physician Practice RCM Market: Revenue Forecast by Offering, US, 2016–2022
  • 13. Hospital RCM Market: Penetration Analysis, US, 2016–2017
  • 14. Physician Practice RCM Market: Penetration Analysis, US, 2016–2017
Related Research
Revenue cycle management (RCM) refers to myriad administrative and clinical functions around the capture, management, and collection of patient service revenue. The RCM process starts with admission (patient access) and continues through to accounts receivable (payment and collections). A variety of RCM solutions (e.g., IT applications and services) are deployed to help healthcare providers perform different functions. The objective of this research service is to present a comprehensive analysis of the US RCM market with respect to trends, revenue growth potential, and the dynamics at play for RCM information technology (IT) and services deployed by hospitals and physician practices through 2022. Additionally, the report will • analyze market forces impacting adoption of RCM IT and service solutions among hospitals and physician practices • evaluate existing and emerging regulatory objectives centered on providers’ financial risk management initiatives • highlight best practices in the areas of design and deployment of an integrated financial workflow that supports value-based care • assess the outlook of outsourced or shared service-based RCM operating models • identify 5 major growth opportunity areas related to RCM • estimate the revenue potential of the total US RCM market (software applications and services), and include breakdowns by hospitals and physician practices, from 2016 to 2022 • shortlist vendors that propose best-in-class solutions for hospitals and tphysician practices This study is segmented into major functional segments of RCM, • Patient access • Registration and charge capture • Billing and collection In terms of end-user adoption, this study classifies the buyer market in two broad provider categories: • Hospitals • Physician practices The market projection ($ value) is stratified based on the following overarching RCM product segments: • IT (software applications) • Services Market Background The shift in population demographics couple
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Table of Contents | Executive Summary~ || Key Findings—Study Highlights~ || Scope and Segmentation~ || Market Engineering Measurements~ || CEO’s Perspective~ || Key Companies to Watch~ || Executive Summary—3 Big Predictions~ | Market Overview~ || Market Definition~ || Market Background~ || Introduction to MACRA—Significant Changes to Provider Reimbursement Processes~ || Comparison of the 3 Payment Pathways Under MACRA~ || MACRA’s Final Rule—Implementation Timeline and Payment Adjustment Metrics~ || MACRA Final Rule for Reporting Year 2018—5 Key Takeaways~ | Introduction to RCM~ || US RCM Ecosystem—Key Product Applications~ || End-User and Product Segmentation of RCM~ || Key Market Elements Driving the US RCM Industry~ || End User-Specific Market Drivers~ || Physician Workflow~ || Why is it Important to Understand Trends in RCM?~ || Staffing Challenges Related to Medical Billing and Coding~ || Key Business Challenges~ || Drivers of Replacing RCM Platforms or Adding Value-added Capabilities~ || State of Digitization and Its Impact on Providers’ RCM Expense~ | Hospital RCM Market Analysis~ || Adoption of Essential RCM Components~ || Adoption of Next-Gen RCM Components~ || Replacement Rate vsPure Upgrade~ | Physician Practice RCM Market Analysis~ || Key Pain Points~ || Benefits of Physician Practice Management Solution~ || Considerations to Ensure Optimal Results from Practice Management Systems~ || Evolution of Practice Management Systems~ || Replacement Rate vsFirst-Time Purchase Including Add-ons~ || KPIs for Hospitals~ | Value-Based RCM Ecosystem~ || Value-Based RCM—How the Ecosystem Should be Conceptualized~ | Outsourced RCM Services~ || Introduction to Outsourced RCM Services—Assessment of Market Forces~ || Outlook for Outsourced RCM Services—A Wide Array of Business Models are at Play~ || Key Considerations for RCM Outsourcing~ || Assessment of Best Practices—Outsourced RCM Services~ | Forecasts and Trends—Total RCM Market~ || Market Engineering Measurements~ || Forecast Methodology and Assumptions~ || Revenue Forecast~ || Percent Revenue Forecast by End-User Segment~ || Revenue Forecast by End-User Segment~ | Forecasts and Trends—Hospital RCM Market~ || Market Engineering Measurements~ || Revenue Forecast~ || Revenue Forecast by Offering~ | Forecasts and Trends—Physician Practice RCM Market~ || Market Engineering Measurements~ || Revenue Forecast~ || Revenue Forecast by Offering~ | Penetration Analysis—Total RCM Market~ || Penetration Analysis—Hospitals~ || Penetration Analysis—Physician Practices~ | Vendor Landscape Assessment—Total RCM Market~ || Competitive Market Forces~ || Vendor Market Share—Total RCM Market~ || Vendor Trends~ || How Vendors Mitigate Financial Risk via Value-based RCM Solutions~ || Market Gaps in the United States~ | Competitive Market Structure~ || Competitive Environment~ || Healthcare RCM M&A—How 2016 Fared Against 2015~ || Notable M&As~ | Vendor Segmentation and Profiles~ || Vendor Segmentation—Software Application Providers~ || Vendor Segmentation—Service Providers~ | Growth Opportunity Assessment~ || 5 Major Growth Opportunities~ || Strategic Imperatives for Success and Growth~ | Future Perspectives~ || The Last Word—3 Big Predictions~ || The Last Word—Discussion~ || Legal Disclaimer~ | Appendix~ || Market Engineering Methodology~ || Exhibits~ || Sources~ || Vendor Segmentation Capability Definitions~
List of Charts and Figures 1. Total RCM Market: Growth Rate, US, 2016–2022~ 2. Total RCM Market: MACRA’s Impact on Provider Reimbursement, US, 2015–2016~ 3. Total RCM Market: MACRA’s Impact on Provider Reimbursement, US, 2015–2016~ 4. MACRA Final Rule, US, 2017–2019~ 5. Total RCM Market: Core and Advanced Applications Driving the Ecosystem, US, 2017 ~ 6. Total RCM Market: Denials’ Impact on Providers Total Missed Revenue Opportunities, US, 2013–2015~ 7. Total RCM Market: Staffing Challenges Related to Medical Billing and Coding, US, 2017 ~ 8. Total RCM Market: State of Digitization and Its Impact on Providers’ RCM Expense, US, 2014–2015 ~ 9. Hospital RCM Market: Adoption of Essential RCM Components, US, 2015–2017~ 10. Hospital RCM Market: Adoption of Next-Gen RCM Components, US, 2015–2017~ 11. Physician Practice RCM Market: Key Pain Points, US, 2017~ 12. Physician Practice RCM Market: Providers' Perceived Value of Benefits, US, 2016~ 13. Total RCM Market: KPIs for Hospitals, US, 2016–2017 ~ 14. Total RCM Market: Corporate Objectives for VBC, US, 2017–2022~ 15. Total RCM Market: What Leading Providers Do to Enable VBC, US, 2017–2022~ 16. Total RCM Market: Strategic and Tactical Consideration for RCM Outsourcing, US, 2017~ 17. Total RCM Market: Market Engineering Measurements, US, 2016~ 18. Total RCM Market: Revenue Forecast by End-User Segment, US, 2016–2022~ 19. Hospital RCM Market: Market Engineering Measurements, US, 2016~ 20. Hospital RCM Market: Revenue Forecast by Offering, US, 2016–2022~ 21. Physician Practice RCM Market: Market Engineering Measurements, US, 2016~ 22. Physician Practice RCM Market: Revenue Forecast by Offering, US, 2016–2022~ 23. Total RCM Market: Vendor Market Share, US, 2016~ 24. Total RCM Market: Critical RCM Capabilities Being Embraced by Providers for Financial Risk Management, US, 2016–2022~ 25. Total RCM Market: Competitive Structure, US, 2017~ 26. Hospital RCM Market: Competitive Structure, US, 2017~ 27. Physician Practice RCM Market: Competitive Structure, US, 2017~ 28. Total RCM Market: Notable M&As, US, 2015–2016~ 29. Total RCM Market: Software Application Providers, US, 2017 ~ 30. Total RCM Market: Service Providers, US, 2017~| 1. Total RCM Market: Market Engineering Measurements, US, 2016~ 2. Total RCM Market: End-User and Product Segmentation, US, 2016~ 3. Hospital RCM Market: Revenue Segmentation Across Product Categories, US, 2017~ 4. Physician Practice RCM Market: Revenue Segmentation Across Product Categories, US, 2017~ 5. Total RCM Market: Physician Workflow on a Typical Day, US, 2017~ 6. Hospital RCM Market: Rate of Replacement vs. Upgrades, US, 2013–2020 ~ 7. Total RCM Market: Revenue Forecast, US, 2016–2022~ 8. Total RCM Market: Revenue Share Forecast by End-User Segment, US, 2016–2022~ 9. Hospital RCM Market: Revenue Forecast, US, 2016–2022~ 10. Hospital RCM Market: Revenue Forecast by Offering, US, 2016–2022~ 11. Physician Practice RCM Market: Revenue Forecast, US, 2016–2022~ 12. Physician Practice RCM Market: Revenue Forecast by Offering, US, 2016–2022~ 13. Hospital RCM Market: Penetration Analysis, US, 2016–2017~ 14. Physician Practice RCM Market: Penetration Analysis, US, 2016–2017~
Author Koustav Chatterjee
Industries Healthcare
WIP Number K1C3-01-00-00-00
Keyword 1 Revenue Cycle Management
Keyword 2 US Revenue Cycle Management Market
Keyword 3 RCM
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